Meditation app Calm lays off 20% of its staff

Calm.com Inc., maker of popular meditation and wellness app Calm, has laid off 20% of its staff, according to a memo sent Thursday by Chief Executive David Ko to employees.

People familiar with the matter said San Francisco-based Calm employed about 400 people and about 90 had been laid off.

“Unfortunately, today we are reducing our overall workforce by 20%,” Mr. Ko said. “While some of you will be affected, you will all be affected. I can assure you that this was not a easy decision, but it’s especially difficult for a company like ours whose mission is focused on mental health and well-being in the workplace.

In the memo, Mr. Ko wrote that Calm management had “revisited the investment thesis behind each project” before deciding to make changes that would help stabilize the business.

“We did not take this decision lightly, but we are confident that these changes will help us prioritize the future, focus on growth and become a more efficient organization,” he wrote.

Mr. Ko’s memo did not specify the reasons for the layoffs but promised employees “a more in-depth discussion about the future of the business” at a town hall meeting scheduled for Friday. A Calm spokeswoman declined to make Mr. Ko available for an interview.

Calm.com CEO David Ko in 2019.


Photo:

Travis P Ball/Getty Images for SXSW

An employee who was laid off said company management cited macroeconomic trends to explain the layoffs and told employees they had been trying to cut spending in recent months to avoid downsizing.

The employee and another person familiar with the situation said about a dozen positions in Calm’s consumer marketing department had been cut as part of the cuts.

Mr. Ko was named co-CEO of Calm earlier this year alongside co-founder Michael Acton Smith, and became sole CEO this summer when Mr. Smith and co-founder Alex Tew announced they would would become co-chairs.

Mr. Ko was previously CEO of Ripple Health Group, a health technology company acquired by Calm in February. Other former Ripple executives have also taken on leadership roles at Calm. Bennett Porter, a former chief marketing officer at Ripple, now leads Calm’s consumer marketing division and reports to vice president of content Greg Justice, who was previously at TikTok.

Several years ago, venture capitalists started pumping money into Calm as well as competitors such as Headspace Health Inc., Happier Inc. and Modern Health Inc.

Calm was founded in 2012 and became the first so-called unicorn in the meditation app industry in 2019.

It hit a $2 billion valuation the following year after raising $75 million. Investors have included Lightspeed Venture Partners, TPG, Goldman Sachs Group Inc.

and Salesforce Inc.

Co-General Manager Marc Benioff.

In recent years, the company has invested heavily in marketing, hiring Mr. Justice and a former Netflix marketing executive, running television commercials and sponsoring CNN’s coverage of the 2020 election as well as a miniseries. HBO Max 2021 featuring Kate Winslet, Idris Elba and more stars.

The employee and the other person with knowledge of the situation said Calm’s recent cost-control measures included cuts to its marketing budget.

Write to Patrick Coffee at [email protected]

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